Yackety-yack (Please talk back)

So new and yet so ... old? Bank tech trends can make your head spin. So regularly longtime Tech Exchange Editor John Ginovsky does his best to “make sense of it all.”

Chatbots have been around banking for years already. So has artificial intelligence. Now, it seems, these discrete technologies are progressing the way most of the emerging technologies of the recent era have done. That is, to mash up and accelerate together in the overarching need to provide ever-more customer-centric, value-added service delivery.

Which is a long way of saying: Increasingly intelligent voice assistants are poised to do to mobile banking what mobile banking did to online banking.

Such a claim is not so outlandish to make.

Just think of how voice assistants have taken over popular culture.

Capturing the concept

Who hasn’t seen the TV ad of the guy locked in his garage asking his voice gadget to contact someone in the living room? Who hasn’t seen the exhausted Aaron Rodgers collapsing in his bed and asking his voice device to “play something soothing”?

Capgemini surveyed more than 5,000 consumers in the U.S., U.K., France, and Germany on the subject. The firm concluded that voice assistants will become a dominant mode of consumer interaction over the next three years, with shoppers who use the technology willing to spend 500% more than they currently do via this mode of interaction.

Diving deeper, the research found that today, 24% of respondents would rather use a voice assistant than a website. In the next three years, this figure will rise to 40%. Close to a third (31%) said they will prefer a voice assistant interaction to visiting a shop or a bank branch, compared to 20% today.

Why? Mark Taylor, chief experience officer, Digital Customer Experience practice at Capgemini, says: “What makes voice assistants so exciting is that they are woven into the fabric of our lives, offering a simplicity and richness of interaction that consumers have never experienced before.”

An independent survey from Accenture finds that consumers are using their smartphones less often now for entertainment and online purchasing. It canvassed 21,000 consumers in 19 countries and found that consumers who instead have acquired digital voice assistant devices powered by artificial intelligence tend to use these devices more than their smartphones.

“Digital voice assistant devices are challenging smartphones as the central hub for all activities in the home,” says David Sovie, global managing director of Accenture’s High Tech business. “These low-cost devices deliver valuable and practical benefits and are relatively easy to use, and their rapidly growing popularity is one of the most striking trends in the high-tech industry.”

Accenture’s survey projects that ownership levels of these devices will more than double this year, reaching 37% in the U.S. Pointedly, 63% of total respondents said they are either using a voice assistant device or are interested in owning one; 94% of current users are either satisfied or very satisfied with these products.

Ginovsky’s own poll

When one is presented with such startling claims (the diminishing of the mobile phone!) it is instructive to get a sense of how prevalent these devices are.

I, personally do not have one. But what about my neighbors?

I belong to a Google Group of about 35 families just in my city residential block. I sent out a cheeky little survey of my own just to gauge local interest in voice assistants.

Within three hours, I received nine responses (including one from way out of this geographic group). Seven happily admitted to having such a device and were very satisfied with it. Two did not have one and did not want to get one.

Those who had them said they use them to get news and weather, to answer random questions, and to play music. Those who didn’t cited privacy concerns and a general annoyance for having too many electronic gadgets in the house already.

While hardly a scientific sample, this does illuminate the fact that people really do have and use these things.

Banking chats up digital assistants

It’s a fact that is drawing some real attention and some real dollars in the banking industry. Suman Ghattacharyya, writing in the Tearsheet blog discusses Kasisto, a company that offers a conversational AI platform that’s used by a dozen financial institutions around the world, and which just received a $17 million Series B funding round.

The idea behind this is that existing chatbots, which are limited to a set menu of responses, can’t really have productive conversations with customers. Such “contextual conversations” are crucial for the bank to in turn respond with intuitive responses and much more valuable interactions with customers.

“What’s at play here is a way to add more value to the bank-customer interaction beyond just simple commands,” says Mark Schwanhausser, director of omnichannel financial services at Javelin Strategy and Research, commenting on the Kasisto funding.

“What banks are good at doing is finding ways to reach a customer,” says Schwanhausser. “They’ve got multiple ways to do so, but [they] don’t have anything to talk about when [they] start conversations…Customers don’t care about [comments] like ʻYou have a statement available’.”

Value-added is what it’s about

In other words, it comes down to giving a given customer value-added service, based on what the bank knows about that customer and what it can anticipate, through analytics and AI, what the customer may be open to considering.

There’s the main point: added value. It’s a time-tested marketing fundamental, only now turbo boosted by technology that itself is turbo boosted.

CGI issued a recent report where it surveyed 2,250 consumers across nine countries. Overall, it shows an increasing willingness among consumers to move to financial service providers that offer more value-add services, such as advice, rewards, and personal finance management.

Two out of three consumers, it says, feel they have lost a personal connection with their bank, yet two out of three consumers also feel long-term relationships with their banking partner is important.

“This dichotomy creates a significant opportunity for banks that are ready to pursue customer-centric strategies—strategies that combine relevant and personalized digital services with personal services through both in-person (branch) and remote channels (phone, video, and chat),” CGI says.

Lauren Kindzierski, vice-president of Hinduja Global Solutions, advocates for what is likely to become a growing theme this year: Enhancing customer experience by creating an “emotional connection.”

Granted, at first glance what she recommends could come directly from the 1969 rock opera (rock opera?) Tommy song lyrics by The Who (the who?): “See me, feel me, touch me, heal me…”

Aite Group sums up this sentiment in its recent report. “Banks are experimenting with chatbots and interactive assistants now on a small scale, but Aite Group research suggests that more sophisticated data and machine learning is necessary before banks can better understand and even predict what customers need.”

Tiffani Montez, Aite Group senior analyst, adds: “Financial institutions should start by building experiences that are centered on making users aware of their financial activity. Once you master that, begin layering in more data to provide customers with insight into their finances, and then provide them with actionable advice.”

John Ginovsky is a contributing editor of Banking Exchange and editor of the publication’s Tech Exchange e-newsletter. For more than two decades he’s written about the commercial banking industry, specializing in its technological side and how it relates to the actual business of banking. In addition to his weekly blogs—"Making Sense of It All"—he contributes fresh, original stories to each Tech Exchange issue based on personal interviews or exclusive contributed pieces. He previously was senior editor for Community Banker magazine (which merged into ABA Banking Journal) and for ABA Banking Journal and was managing editor and staff reporter for ABA’s Bankers News. Email him at [email protected]